Tata Steel calls on UK to lift ￡50m cap on COVID-19 aid
2020-04-26 14:22:56 [Print]
Britain's biggest steelmaker is seeking hundreds of millions of pounds in emergency government aid, as the COVID-19 crisis threatens to plunge an already-struggling industry into meltdown.
Tata Steel's UK arm has told the government existing programs devised to help businesses during the COVID-19 pandemic are likely to fall short given the scale and length of the disruption from lockdown measures.
A slump in orders from carmakers, manufacturers and the construction industry has hit steel producers hard. Tata Steel, which runs the Port Talbot plant in Wales, is asking for an exemption on the upper limit to the Coronavirus Business Interruption Loan Scheme. This allows companies to borrow a maximum of ￡50m from banks with a government guarantee of 80 per cent.
Stephen Kinnock, Labor MP for the Aberavon constituency that is home to the Welsh steelworks, said ￡50m would only cover about 10 per cent of the cash flow impact to Tata Steel over a six-month period. He urged the Treasury to lift the cap.
Other companies hoping for assistance include Liberty House, Spanish-owned Celsa and British Steel, which was rescued from bankruptcy by the Chinese conglomerate Jingye Group last month.
Tata Steel's UK arm has told the government existing programs devised to help businesses during the COVID-19 pandemic are likely to fall short given the scale and length of the disruption from lockdown measures.
A slump in orders from carmakers, manufacturers and the construction industry has hit steel producers hard. Tata Steel, which runs the Port Talbot plant in Wales, is asking for an exemption on the upper limit to the Coronavirus Business Interruption Loan Scheme. This allows companies to borrow a maximum of ￡50m from banks with a government guarantee of 80 per cent.
Stephen Kinnock, Labor MP for the Aberavon constituency that is home to the Welsh steelworks, said ￡50m would only cover about 10 per cent of the cash flow impact to Tata Steel over a six-month period. He urged the Treasury to lift the cap.
Other companies hoping for assistance include Liberty House, Spanish-owned Celsa and British Steel, which was rescued from bankruptcy by the Chinese conglomerate Jingye Group last month.
